US Reg Round Up: 16/01/2025

Federal Reserve

Federal Reserve issue interagency statement on supervisory practices - 14 January 2025

The California financial regulators (DFPI, FDIC, Federal Reserve, NCUA, OCC) are offering support to financial institutions affected by the wildfires and winds. They encourage institutions to work with borrowers and adjust loan terms, provide temporary facilities, and address reporting challenges due to the disaster. Regulatory penalties will not be imposed for reasonable delays. Institutions can receive CRA consideration for disaster-related community support. For more details, refer to FEMA’s disaster declarations.

Federal Reserve seek public comment on significant changes to improve transparency of bank stress tests - 23 December 2024

The Federal Reserve Board will soon seek public comment on proposed changes to improve transparency in bank stress tests and reduce volatility in capital requirements. These changes aim to disclose and seek feedback on models used to determine banks' hypothetical losses, average results over two years, and allow public input on stress test scenarios before they are finalized. The changes won’t significantly affect capital requirements but will enhance the resilience of the stress test framework. The public comment process will begin in early 2025.

Federal Reserve release annual asset-size thresholds under community reinvestment act regulations - 19 December 2024

The Federal Reserve Board and the Federal Deposit Insurance Corporation have updated the Community Reinvestment Act (CRA) asset-size thresholds for 2025. A "small bank" is defined as having assets under $1.609 billion, while an "intermediate small bank" has assets between $402 million and $1.609 billion. These thresholds are adjusted annually based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), reflecting a 2.91% increase in 2024.

Securities and Exchange Commission

SEC approves 2025 PCAOB budget and accounting support fee - 18 December 2024

The SEC has approved the 2025 budget for the Public Company Accounting Oversight Board (PCAOB), totalling $399.7 million, along with the related accounting support fee of $374.9 million. Of this fee, $346.1 million will be assessed on public company issuers, and $28.8 million on registered broker-dealers. SEC Chair Gary Gensler emphasized the importance of trust in financial markets and the PCAOB's role in maintaining that trust through auditing standards. The PCAOB's budget and fees are reviewed and approved annually as part of the oversight mandated by the Sarbanes-Oxley Act of 2002.

SEC modernizes the submission of certain forms - 16 December 2024

The SEC has adopted amendments to modernize the filing and submission process for certain forms, filings, and materials under the Securities Exchange Act of 1934. These amendments require registrants to file electronically using the EDGAR system or by posting online. The changes, which aim to modernize the Commission's requirements for the digital age, will also harmonize the Financial and Operational Combined Uniform Single (FOCUS) Report. The amendments will take effect 60 days after publication in the Federal Register, with compliance dates ranging from 60 days to June 30, 2028.

Office of the Superintendent of Financial Institutions

OSFI maintain domestic stability buffer - 17 December 2024

The Office of the Superintendent of Financial Institutions (OSFI) has announced that it will maintain the Domestic Stability Buffer (DSB) at 3.5%. This level, effective since November 2023, reflects OSFI's assessment that Canada's financial system remains stable and that systemically important banks have sufficient capital to manage emerging risks. The DSB is designed to help banks absorb losses during financial stress, ensuring they can continue lending. OSFI will continue to monitor the situation and adjust the buffer as necessary based on evolving conditions.